How you can avoid being taken advantage of in sales negotiations

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Do you feel at a disadvantage when negotiating the sales in your business. This presentation will show you how to remain in the box seat and get the best possible outcome for your business

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How you can avoid being taken advantage of in sales negotiations

  1. 1. How you can avoid being ‘taken advantage of’ in sales negotiations © Copyright One Sherpa Pty Ltd 2010
  2. 2. When you are negotiating with customers, which is more important? TERMS or PRICE © Copyright One Sherpa Pty Ltd 2010
  3. 3. How many times have you forgotten about terms when negotiating a sale? © Copyright One Sherpa Pty Ltd 2010
  4. 4. Have you been so focused on making a profit that you simply didn’t consider how and when you might get paid? © Copyright One Sherpa Pty Ltd 2010
  5. 5. Have you been guilty of thinking you’re making money, when all you were focused on was making profit? © Copyright One Sherpa Pty Ltd 2010
  6. 6. Which do you think is more important? TERMS or PRICE © Copyright One Sherpa Pty Ltd 2010
  7. 7. What gets affected in a sale when you focus on Terms? The level of Accounts Receivable. © Copyright One Sherpa Pty Ltd 2010
  8. 8. This is where money gets stuck in your business because your customers are NOT paying you © Copyright One Sherpa Pty Ltd 2010
  9. 9. Terms can be measured in days but this will translate into money that your customers owe you! © Copyright One Sherpa Pty Ltd 2010
  10. 10. What gets affected in a sale when you focus on Price? The sales value and therefore the margin that you will make on those sales © Copyright One Sherpa Pty Ltd 2010
  11. 11. If you fail to earn the right margin… you will not get enough money to survive even when your customers finally pay you! © Copyright One Sherpa Pty Ltd 2010
  12. 12. So which is more important? or PRICE? TERMS © Copyright One Sherpa Pty Ltd 2010
  13. 13. The truth is that they’re both important. © Copyright One Sherpa Pty Ltd 2010
  14. 14. It’s not a case of It’s a case of EITHER / OR BOTH / AND © Copyright One Sherpa Pty Ltd 2010
  15. 15. So where will you find out how you’re going with this in One Minute Business Checkup? © Copyright One Sherpa Pty Ltd 2010
  16. 16. There are two of the measures which will be affected by the decisions you make around Terms and Price © Copyright One Sherpa Pty Ltd 2010
  17. 17. Let me show you how to check these measures in One Minute Business Checkup © Copyright One Sherpa Pty Ltd 2010
  18. 18. PROBLEM #5 © Copyright One Sherpa Pty Ltd 2010
  19. 19. Let’s take an example where you were negotiating prices on your largest customer who was purchasing $200,000 of your sales each year You were looking for a 10% price increase and the customer agreed to the increase if you would increase their terms from 30 Days to 60 Days © Copyright One Sherpa Pty Ltd 2010
  20. 20. Let’s first look at the price increase. CALCULATION OF INCREASE 10% on $200,000 would be an additional $20,000 in sales © Copyright One Sherpa Pty Ltd 2010
  21. 21. $20,000 more Sales Increase in Margin from 20% to 21.9% © Copyright One Sherpa Pty Ltd 2010
  22. 22. Let’s look at how the new terms will affect Accounts Receivable CALCULATION OF CURRENT OUTSTANDING 30 Days / 365 Days * $200,000 = $16,438 CALCULATION OF NEW OUTSTANDING 60 Days / 365 Days * $220,000 = $36,164 An Increase in Accounts Receivable of $36,164 - $16,438 = $19,726 © Copyright One Sherpa Pty Ltd 2010
  23. 23. $19,726 more A/c Receivable © Copyright One Sherpa Pty Ltd 2010
  24. 24. Checkout your own information now. © Copyright One Sherpa Pty Ltd 2010
  25. 25. Using the sandbox you can ‘play with the numbers’ to make sure your sales negotiations get the best results © Copyright One Sherpa Pty Ltd 2010
  26. 26. Go to www.oneminutebusinesscheckup.com and make sure you’ve got the best price negotiation in your business © Copyright One Sherpa Pty Ltd 2010

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